The central nervous system is made from a limited number of microcircuit motifs. Our long-term goal is to unravel the general principles of the elementary microcircuits. In this study, we focus on the contribution of synaptic modulation to circuit function, sensory processing and animal behavior. GABA is the major inhibitory neurotransmitter in the central nervous system and plays a key role in synaptic modulation. GABA exerts its modulatory role via two distinct receptor systems, the fast ionotropic GABAA and the slow metabotropic GABAB receptors. There is good evidence from human clinical trials and animal experiments to suggest that GABAB receptor agonists reduce the craving for drugs such as cocaine, heroin, alcohol, and nicotine. The molecular cloning of GABAB receptors report a lack of heterogeneity, suggesting limited possibilities for selective interference with the GABAB receptors to avoid side effects in pharmacotherapy. Selection of alternative targets in the GABAB system could be aided by a deeper understanding of the GABAB receptor mediated synaptic modulation in basic neural circuits. GABAB receptor mediated synaptic modulation is the focus of this study. The anatomical simplicity and the power of genetics make Drosophila a particularly amenable system to investigate the contribution of synaptic modulation to circuit function as well as behavioral output. We have obtained evidence showing that Drosophila odorant receptor neurons express GABAB receptors and the activation of GABAB receptors causes presynaptic inhibition. We adopt a multidisciplinary approach that combines molecular genetics, behavioral studies, and optical imaging to study GABAB receptor mediated feedback inhibition in the olfactory system, and also its contribution to olfactory behaviors. Studies of such defined olfactory circuit should shed light on the general principles of synaptic modulation and feedback inhibition. These general principles should also guide target selection for future therapeutic interventions. PUBLIC HEALTH RELEVANCE There is good evidence from human clinical trials and animal experiments to suggest that GABAB receptor agonists reduce the craving for drugs such as cocaine, heroin, alcohol, and nicotine. However, a selective interference with the GABAB receptors without side effect is limited by the lack of receptor heterogeneity. The work of this proposal is basic science that seeks to reveal the mechanisms of the GABAB system in synaptic modulation and circuit function, creating a knowledge base from which alternative targets in the GABAB system can be evaluated for future therapeutic interventions.